Monday, November 23, 2009

Saturday, November 7, 2009

This is part 1 of my series on how Michigan can learn from Israel's economic success.

On January 21st 1988, Roger Smith, the chairman of General Motors, was undoubtedly distressed. A young executive named Elmer Johnson had written a biting critique of the company's culture. He wrote: “We have vastly underestimated how deeply ingrained are the organizational and cultural rigidities that hamper our ability to execute.”

21 years later, another bold executive, Rob Kleinbaum, penned a similar appraisal: "GM’s decision making processes need serious revamping. Despite improvements, most meetings are still exercises in procrastination, rubber stamping or idea killing, without anything that would pass for genuine debate and dialogue. Dealing with complex issues requires genuine discussion, feedback, and intellectual engagement."

Most explanations for General Motor's collapse agree that the company's culture discouraged critical thinking and open debate. This was not the only problem, but it undermined attempts to solve other problems, because the organization's ability to think clearly was crippled.

Contrast this with a story of another company that needed to challenge conventional wisdom to succeed - Intel.

In the microchip industry, faster always meant better. At least until the chips got so fast that they couldn't operate without overheating. Most companies designed elaborate cooling systems to compensate, but Intel's Israeli team of engineers had other plans. They realized that the cooling mechanisms could only help up to a point, were clunky, and used too much power. After months of experimentation and debate, they developed a chip with the equivalent of gears on a car. It could perform at high levels with lower speed. This breakthrough innovation promised to revolutionize the entire industry.

When they pitched the idea to Intel's corporate executives, they met a wall of resistance. No one thought they could sell a technically "slower" chip, when all their competition was focused on speed. The Israelis had the guts to persevere and ultimately convince their bosses to go ahead with their project, and it was a wild success for the company. The technology they invented is now the new industry standard.

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The difference between winning and losing starts with an organization's dedication to the truth - no matter what the consequence to egos or hierarchy.

Chutzpah is a Hebrew term, roughly meaning "audacity" or "gall". It takes serious chutzpah to challenge the thinking of those senior to you, if they are incompetent. Prudent leaders encourage dissent.

In the Israeli military, junior officers often disagree with their superiors in ways that would surprise even the most progressive American officer. It's not a sign of disrespect - it's a shared cultural value. They understand the importance of the free flow of ideas. They maintain a healthy distance between their ideas and their ego.

If you're possessive of your idea, then an attack on it is an attack on you. You'll do everything you can to defend it, even though it may be wrong. This places far too much importance on ideas. Despite what we often hear, it's not the idea that matters, it's the result. If you have a team striving to achieve a common result, they'll ruthlessly abandon ideas that don't work in favor of ones that do - ones that are closer to truth.

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How To Nurture A Culture of Chutzpah in Michigan

Education shapes culture. We should design a public education system that intentionally develops high-chutzpah individuals.

Extra-curricular activities like debate gives kids a healthy tolerance for argumentation. If you aren't used to it, debate is emotionally challenging. Over time you learn how to argue without taking it personally.

This is a good first step, but debate isn't enough by itself. For all it's merits, debate doesn't foster a dedication to the truth. You simply learn how to defend a point - any point. Without a firm hold on reality, you end up with a bunch of people arguing in a room about, well, nothing.

To remedy this, we should combine debate with exercises that have groups of students solve complex yet concrete problems. One example is the classic egg-drop experiment, where you have to design a mechanism that allows an egg to survive a two story fall. If you have a group of kids arguing about the best way to build protection for the egg, they ultimately have to reach a compromise and test their idea. The egg either breaks or survives, and the kids learn to value the truth higher than the ideas of the most persuasive speaker.

These are just two initial ideas, but my main point is that it's possible to design a system that intentionally develops a specific type of culture. We're not powerless. If we get serious about this effort, I'm fairly certain Michigan would become a talent hotspot. The economy of the future depends on knowledge and innovation, and the place with the best talent will also be the most prosperous. I would love to hear a discussion on how Michigan can intentionally develop more chutzpah in it's talent.

A lot of Michiganders have already bemoaned the Granholm/Cherry administration's massive cuts to education, but I have one reason to be angry that's not been a part of the conversation yet. In fact, it's not been a part of the conversation in Michigan at all that I can tell - cuts to education or not.

I'm talking about the Race to the Top initiative, by Arne Duncan, the U.S. Secretary of Education. It's $4 billion dollar fund that will award grants to states who compete and win against other states. Hence the name, "race to the top".

Michigan isn't doing a very good job "racing" at all, and we've got some competition that is actually serious about structural reform. Recently, in a speech in Wisconsin, Obama mentioned efforts that some of our rival states were taking to position themselves to win a grant:

I'm proud to say that already a number of states have taken us up on this challenge. Across the country, different groups are coming together to bring about change in our schools -- teachers unions and parents groups, businesses and community organizations. In places like New Haven, educators and city leaders have come together to find a smarter way to evaluate teachers and turn around low-performing schools. In states like California and Indiana and Wisconsin, you're seeing steps taken to remove these so-called firewall laws so we can have a clear look at how well our children are learning and what can be done to help them learn better. States like Delaware and Louisiana, Tennessee and Illinois are all making efforts to let innovative charter schools flourish.

I know we've been busy with our annual embarrassing budget crisis, but is it not possible for us to focus on structural reforms, so maybe the funding cuts won't hurt so bad? What is Michigan doing to compete against these states who are already taking steps to ensure they win in the knowledge economy?

We're cutting vital scholarships and funding, when we have legislators who gave themselves a pay raise a couple years ago, film credits that do more for Hollywood than Michigan, one time tax credits to politically-favored companies, and a shiny new building downtown for our police captains (while their boots on the ground are getting laid off).

Wednesday, November 4, 2009

I love stumbling upon books that are completely unexpected, yet utterly relevant. Recently, I was browsing in Barnes & Noble, and picked up Start-up Nation: The Story of Israel's Economic Miracle, by Dan Senor and Saul Singer. It explains how a country "of 7.1 million, only 60 years old, surrounded by enemies, in a constant state of war since its founding, with no natural resources-- produces more start-up companies than large, peaceful, and stable nations like Japan, China, India, Korea, Canada and the UK".

Even if you are critical of Israel politically, you have to admit that its economy is worth studying. Consider these facts that the book highlights in its introduction:

In May of 2009, Israel had over 63 companies listed on NASDAQ, the most of anyone besides the US. Canada came in second, with 48, and Japan came in third, with only 6.

Israel's rate of venture capital investment was over $250 per person in 2008. The U.S. was second, with less than $100 per person, and Ireland was third, with over $50 per person.

As I was reading, I realized that Michigan needs to pay especially close attention, since we're trying to rebuild our economy around an entirely new set of industries than the ones that have traditionally sustained our prosperity. The middle class our parents grew up with was built around a guaranteed supply of high-paying manufacturing jobs that will never return. We must emerge from this recession by creating an environment in which start-ups can thrive, ideas and knowledge are the crucial skill sets, and stagnant institutional thinking gives way to unbounded creative energy.

However, just because we all (mostly) agree that this transition is necessary, we don't agree how to do it. Some argue that tax policy is the most important. The MEDC seems to be focused on advertising and offering special tax credits to specific companies considering coming to Michigan. Non-profits like Michigan Future, who believe talent is the crucial ingredient, are focused on improving education. Young Smart Global Lansing is a consortium of entrepreneurs taking it to the streets in a grassroots effort to get skilled college grads to stay in Michigan and start companies.

The problem is multifaceted, so there is no silver bullet. It's going to take the right leadership, the right institutions, and the right culture to make this effort successful. Most of all, we have to be willing to learn from the past, and shed dogmatic ideologies. Isn't that what innovation is all about, anyway?

I hope to contribute to the conversation by applying Israel's lessons to Michigan in case study that spans a series of blog posts. Obviously, the goal isn't to duplicate Israel - that's impossible. However, we can clarify our understanding of the universal elements of a dynamic, knowledge-based economy, and hopefully apply them to Michigan's particular circumstance.

Monday, October 26, 2009

I'm considering applying for Teach for America after I graduate, so I have been doing a decent amount of research on the program, and the other day I discovered a troubling story.

The Backstory

In 2001, Teach for America came to Detroit. Student enrollment dropped, and teacher layoffs became necessary. Naturally, some argue, the newest teachers with the least seniority were the first in line to get the axe. In 2004, Detroit's 34 Teach for America teachers left.

Detroit Schools' Decline

It's apparent to anyone following the situation that Detroit schools have been on a steady decline for a very long time. Want visual proof? Check out this info-graphic from the Wall Street Journal, depicting the 50% drop in enrollments over the past decade.

It's not a pretty picture. But that's just the enrollment. The poor student performance is even more shocking. The school district reports that 58% of it's students graduate, but the real numbers are probably much lower. A study by the Alliance for Excellent Education estimates that less than 25% graduate.

Teach For America's Impact

You can measure the impact of Teach for America quantitatively. A study by the Urban Institute shows "The impact on student achievement of having a Teach For America corps member was at least twice that of having a teacher with three or more years of experience relative to a new teacher. A 2009 follow-up, employing a larger sample of corps members and additional comparison groups, corroborated the initial findings."

However convincing these numbers may be, I think the most compelling evidence for TFA's impact is anecdotal. After Detroit kicked them out, the parent of a student in a TFA teacher's classroom had this to say:

Patrice Mosley, whose daughter Precious is in Gall's class, said losing Gall could make her rethink whether to look for a new school for her son. "He's a creative teacher, a caring teacher," Mosley said. "For this school to lose him is horrible."

If a parent considers switching schools after a teacher leaves, you can bet that is one amazing teacher.

Why Teach for America's Critics are Wrong

The most common objection to Teach for America's strategy is that they recruit people who just use it as a stepping stone to other career goals.

The first thing to remember is that TFA teachers have proven success, so this gripe is essentially a personal one. It doesn't say anything about the quality of instruction these teachers give to their students.

Why does it matter if TFA teachers leave after two years? If they are good teachers, it shouldn't matter to us whether or not they stay. The point is to bring idealistic young people into struggling schools so they can inspire a sense of hope and ambition in the students who probably haven't had many people encourage them to believe in themselves. The only real education is a self-education. You have to be inspired to want to achieve and believe in your abilities to actively pursue a self-education. Some are lucky to be born into people who encourage them to believe in themselves. A rare few find it themselves even in discouraging environments. Most are capable of it if they are inspired by someone.

This is the single most important task of an educator. Learning isn't a transaction where the teacher implants knowledge into the student's heads. The students have to want it. The task of the educator is to make the students want to learn. Without that, they are just wasting their time.

I can understand why teachers would be offended by young hot-shots coming in, "taking" their jobs, and then skipping town for greener pastures. It would have been a tough decision for Detroit Public Schools to lay off veterans and keep the rookies. But, as Crain's Detroit reports, that tough decision has been made by every other major school district, even those with strong union influence.

I hope Mayor Bing, Robert Bobb, and other leaders in Detroit will do everything they can to bring Teach for America back to their fallen city.